Analysts see German outlook as positive for first time since May in December ZEW survey
Investor confidence for Germany surged in December, entering positive territory for the first time since May, on optimism the country will dodge a recession and resume growth next year, according to a survey by the ZEW Centre for European Economic Research.
The ZEW indicator of economic sentiment for Germany soared 22.6 points to 6.9 points in December, beating almost all analysts’ forecasts. The increase comes after the indicator dropped in November on concern over declining German industrial output and exports.
‘Financial market experts forecast the development of economic activity in 2013 with pre-Christmas optimism,’ says Wolfgang Franz, ZEW’s president, in a statement. ‘Although the cooling down of the economic activity will last until the beginning of 2013, Germany will not have to face a recession. But this applies only if the crises in the eurozone do not deepen once again.’
The assessment of the current state of Germany’s economy, however, remained little changed at 5.7 points. Germany is still the only country included in the ZEW survey with a positive assessment of the current state of the economy.
The US comes second in terms of increase in economic confidence in December, according to ZEW, with the six-month economic outlook rising 18.3 points to 31.4, the highest confidence rating of all the countries measured by ZEW. The current state of the US economy was assessed at minus 16.5 points, an increase of 5.6 points from November.
While the outlook for all the economies measured by ZEW improved in December compared with November, the outlook for France improved least, increasing just 4.1 points to minus 11.3. The outlook for the eurozone economy jumped 10.2 points, entering positive territory at 7.6 points.
In terms of the assessment of the current state of the economy, Japan fared worst in December, dropping 11.1 points to minus 64.9. It was the only country to see deterioration in the assessment of its current state this month. Both France and the eurozone as a whole registered a slight increase, of 0.4 points, but remained deeply in the negative, with France at minus 78.2 and the eurozone as a whole at minus 79.9.
The numbers represent the difference between the percentage of analysts who have positive outlooks and those with negative outlooks. This survey covers 278 analysts who were interviewed between November 26 and December 10.
